IMPACT Research Newsletter

Small Business Assistance

The Small Business Innovation Research, or SBIR, and Small Business Technology Transfer, or STTR, programs provide qualified small businesses (SB), including faculty startups, with opportunities to propose innovative R&D projects that meet specific federal needs.

To apply for these programs, a small business must respond to a federal solicitation with a proposal. The university’s presence in the activity will be in the form of a proposal submitted to the SB and a subcontract issued by the SB to the university if an award is made to the SB.

The Office of Innovation and Entrepreneurship (OIE) and the Office of Sponsored Programs (OSP) will work together to ease the proposal process and increase the chances of winning an award.

OSP, through the Preaward Development Specialist, can help faculty identify solicitations that match the R&D capabilities of the research faculty and the associated SB. OIE and OSP can also help identify research collaborators at the university to give the proposal a competitive edge.

A: Phase I is a feasibility study to evaluate the scientific and technical merit of an idea or technology. Awards are for period of up to six months (SBIR) to one year (STTR) in amounts up to $150,000 for SBIR and $100,000 for STTR. (It is important to carefully read the program announcement as funding periods and amounts may vary from one federal agency to another.)

Phase II expands on the results of Phase I and allows consideration of commercialization potential. Awards are for periods up to two years in amounts up to $1,000,000 for SBIR or $750,000 for STTR. Phase III awards support commercialization of the results of Phase II and require the use of private sector or non-SBIR/STTR federal funding.

Q: What federal agencies participate in the SBIR Program?

A: The Department of Agriculture, Commerce, Defense, Education, Energy, Health and Human Services, and Transportation, as well as the Environmental Protection Agency, National Aeronautics and Space Administration, and National Science Foundation.

Q: What federal agencies participate in the STTR Program?

A: The Departments of Defense, Energy, National Aeronautics and Space, Health and Human Services, and the National Science Foundation.

Q: May a portion of an SBIR award be used to pay for outside services or assistance from a university or other nonprofit research institution?

A: Yes, Phase I, up to ⅓ of the award can be used for outside assistance and in Phase II, up to ½ of the award.

Q: For STTR awards, what is the minimum percentage of research that can be conducted by the SB and the university?

A: Small businesses must perform at least 40% of the work and the university must perform at least 30%.

Q: What are the chances of receiving funding?

A: On average, approximately one out of eight Phase I proposals have been funded, and about ⅓ of Phase I recipients have received Phase II funding, but the odds vary among the agencies.

Q: When are proposal deadlines?

A: Each agency manages its’ own program and deadlines, so it varies. Contact the OSP Preaward Office for more information.

NOTE: WHILE THERE IS SOME STANDARDIZATION, EACH AGENCY OPERATES ITS SBIR/STTR PROGRAMS WITH A CERTAIN AMOUNT OF UNIQENESS. IT IS IMPORTANT TO READ THE SOLICITATION CAREFULLY.

Q: Who is the prime recipient of an SBIR or STTR award?

A:The small business is the prime recipient.

Q: Who is responsible for submitting the proposal to the federal sponsor?

A: The small business.

Q: Are there things I must do in order to be able to receive an award from the federal government:

A: Yes. See the following.

Q: I have a small business but I am not federally registered. Can I still submit a proposal?

A: Yes, but you will be required to have an EIN/TIN in order to receive an award.

Q: Must I have a DUNS number (Dun and Bradstreet Information Services Number)?

A: Yes, but if you do not have a DUNS number at the time of submission, you may type in a 9-digit place holder in order to allow the submission to go through. For example, type in a series of the same digit such as using the number ‘1’ to fill the field.

Q: I am applying to the STTR program. Must I partner with a research institution?

A: Yes.

Q: Is it a problem that the PI at the research institution is a principal in the small business?

A: No, but it is necessary for the research institution to know and manage any potential conflict of interest.

Q: My small business is just getting started and is still acquiring and growing its resources. Can I use the research institution’s facilities for portions of my part of the project?

A: It is not possible for a university financed with tax-exempt bonds to support a for-profit business within its facilities gratis. Occasionally, exceptions might be made but it requires that the small business pay rent for its use of the facilities and the university must report the income. While it is not a preferred solution, each circumstance is unique and a business decision will be made considering the merits at the time of the proposal and subsequent award.

Q: If the proposal is successful, how do I engage the research institution?

A: A subcontract/subaward will be issued by the small business to the research institution.

PROPOSAL – The PI at the research institution must prepare a proposal that will be submitted to the small business by the OSP Preaward/Faculty Support Center

ROUTING FORM – The OSP Routing Form should indicate that the sponsor is the small business, i.e., ‘Dynamic Business Inc.’ Additionally the Routing Form should indicate in the appropriate ‘check box’ that this proposal is prepared and submitted in response to an SBIR/STTR program

FAR COI CERTIFICATION – if the Stevens’ PI is a principal in any capacity with ‘Dynamic Business Inc.,’ the Faculty Activity Report should indicate that there is a relationship.

COI MANAGEMENT PLAN – if an award is forthcoming and the Stevens’ PI is a principal in any capacity with ‘Dynamic Business Inc.,’ a Management Plan must be developed by the Executive Director of OSP and the Director of Internal Audit for presentation to the Provost or the Vice Provost for Research before any funds can be expended.

USE OF STEVENS’ FACILITIES – the Stevens’ PI may not allow ‘Dynamic Business Inc.’ to use Stevens’ facilities in order to accomplish the portion of the project specific to the small business unless a preliminary dialogue has occurred with the Vice Provost of the Office of Innovation and Entrepreneurship and the Executive Director of the Office of Sponsored Programs.

It is not possible for a university financed with tax-exempt bonds to support a for-profit business within its facilities gratis. Occasionally, exceptions might be made but it requires that the small business pay rent for its use of the facilities and the university must report the income. While it is not a preferred solution, each circumstance is unique and a business decision will be made considering the merits at the time of the proposal and subsequent award. If such an unusual event is approved, the Executive Director of the Office of Sponsored Programs must interface with the Chief Financial Officer in order to ensure rental rates are established and income is reported correctly.

STEVENS’s PERSONNEL WORKING AT THE SMALL BUSINESS – Prior to contemplating that Stevens’ personnel will work at the small business in order to accomplish any portion of the award, a dialogue must occur with the Office of Sponsored Programs in order to ensure the individual understands the potential outcomes of such a decision.

It’s important to remember that all the considerations which go into writing any persuasive piece apply to proposal writing. You should give careful thought to what your audience/funding agency wants to hear, how they like to hear it and what criteria they use in evaluating what they hear.

HINT: A good way to approach this is to carefully read the agency announcement. What areas of focus and interest are expressed by the agency in the program announcement? What does your research indicate are the agency’s overall objectives? Does the agency appear to be supporting research in one area of specialization more than others? You should always pay careful attention to the program announcement and observe the format indicated. Don’t make the reviewers work to find the required elements, let them focus on the unique quality of the proposed research.

Remember to allow adequate time for proposal development and composition. It’s exceptionally difficult to produce a good proposal at the last minute and under pressure.

Consider writing your proposal in four major steps: a) outline, b) preliminary draft, c) review, d) final draft. You should review the product at the end of each of these steps.

The outline should be extensive. A good outline contains the first sentence of each paragraph in the proposal. The primary considerations in evaluating your outline are the completeness of the information you will be presenting (Have you addressed all format items in the solicitation?) and the organization of your arguments (Is the argument logical and persuasive?). After you have reviewed and approved your outline, it should be considered "fixed" and unchangeable. There must be exceptionally good reasons for subsequent major modifications to the outline or you will have difficulty staying on schedule.

The preliminary draft fleshes out the outline. At this time you should prepare all appropriate graphics (see discussion below). You should treat this draft as if it is a final draft - good spelling and grammar, etc. are important.

The review should be done by competent and qualified people. If you have in-house resources, use them. If not, seek help from outside. You should consider that highly qualified reviewers often expect and deserve remuneration.

The final draft should consider all possibilities for improving the document and integrate those that seem to have merit. It is at this time that you should edit for mistakes, errors, faulty arguments or logic which might have been missed at earlier stages - including mistakes your review team may have missed.

HINT: Like any written piece, a proposal should have a beginning, middle, and end. The beginning and end are where you highlight the most persuasive reasons for funding your proposal. The middle contains the backup for those arguments, plus an analysis of why any of your firm's weaknesses will not adversely affect performance.

At the beginning of your proposal you must place a technical abstract of no more than 200 words highlighting what you propose to do and how you will do it. At the end you should state these same points in a very brief conclusion. The conclusion should also state why your firm is uniquely qualified for this project. Set a one or two paragraph limit on the abstract and conclusion.

The order of presentation in the middle of your proposal should carefully adhere to the order of items described in the proposal format presented in the solicitation. Reviewers are expecting it this way.

HINT: Even if you have covered the substance of an item earlier, you should devote a section to that item. The section can be brief, for example, "This item has been discussed under Subsection X."

Guide your reader by starting each major section or subsection with a heading. The heading should clearly identify the topic of the discussion to follow. Your headings should be distinguished from the text by underlining or bold type.

HINT: Within each section, carefully choose the placement of your arguments in order to maximize persuasive presentation. In general, it is a good idea to present your strongest argument first, your next strongest argument immediately before your conclusion, and your weakest arguments in the middle. This structure enables you to create a good impression on the reader up front, while saving a good point for the end to overcome any doubts raised by the weaker arguments.

It is also important to be honest with your reader. If your company is weak in one area, present the reader with your solution to that weakness. For example, if you lack in-house expertise for a specific part of your project, state the names of the consultants you will hire to assist you with that part. In this manner, your weaknesses are presented as strengths.

HINT: Remember – the reviewers are experienced in both science and project management. They are likely to recognize an inherent weakness but your proactive anticipation of that and provision of a solution is apt to work to your advantage.